The ITO (TDS)-2, Rajkot, Rajkot V. Smt. Sapnaben Vijaybhai Shrimankar, Rajkot

ITA 191/RJT/2022

AI Insights

The case involves an appeal by the Income Tax Officer, TDS-2, Rajkot against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, which had ruled that the respondent, Smt. Sapnaben Vijaybhai Shrimankar, was not required to deduct tax at source under section 194 IA of the Income Tax Act on a payment made for the acquisition of immovable property. The Revenue challenged this decision, arguing that the provision applies irrespective of the number of transferors or transferees and that the property value exceeded the threshold requiring TDS deduction. However, the appeal was dismissed due to the revised monetary threshold for tax effect in appeals as per the CBDT Circular No. 17 of 2019.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 138278 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-08-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 29-06-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Tax effect; Non-deduction of tax; Tax effect; TDS
• Section: 6; 2; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT (Conducted through E-Court at Ahmedabad) BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I .T .A . N o .1 9 1 /R j t /2 02 2 ( A s se ss m e nt Y e a r : 20 15- 16 ) I nc o m e Ta x O f fic er , TD S- 2, R aj k o t V s. S mt. Sa pn a b e n V ij a yb h a i S h r i ma n ka r , P el ic a n H ou se , O p p . S en t M a r r y S c h oo l, 2 S u r vo d a y S o cie t y, K a la w a d R o ad , R a j ko t- 36 00 0 5 [P A N N o .AL H P S8 6 74 G] (Appellant) .. (Respondent) Appellant by : Shri Abhimanyu Singh, Sr. D.R. Respondent by: None D a t e of H ea r i ng 10.08.2023 D a t e of P r o no u n ce me nt 23.08.2023 O R D E R PER SIDDHARTHA NAUTIYAL, JM: This appeal has been filed by the Revenue against the order passed by the Ld. Commissioner of Income Tax(Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre, (in short “NFAC”), in Order No. ITBA/NFAC/S/250/2021-22/1042314619(1) vide order dated 31.03.2022 passed for Assessment Year 2015-16. 2. The Revenue has taken the following grounds of appeals:- “1. The Ld. CIT(A) has erred in law as well on facts of the case in holding that assessee is not required to deduct Tax at source u/s 194 IA ITA No.191/Rjt/2022 ITO vs. Smt. Sapnaben Vijaybhai Shrimankar Asst.Year –2015-16 - 2 - on payment of Rs. 48,75,000/- made to seller for acquisition of immovable property. 2. The Ld. CIT(A) has erred in law as well on facts of the case in holding that the assessee should not be treated as assessee in default for non-deduction of tax at source u/s 194 IA of Act even when the value of property is in excess of Rs. 50,00,000/- and the provision doesn’t discuss anything about no. of transferor and transferor. 3. The Ld. CIT(A) has erred in law as well as on fact that the assessee was not under obligation to deduct TDS as the property acquired is capital asset and the provision of section 194IA is squarely applicable on the case. 4. On the facts and in the circumstances of the case, the Ld. CIT(A) ought to have decided the issue under reference, in the light of provision of section 194IA which doesn’t discriminate in number of transferor or transferee. 5. The appellant craves leave to amend or alter any ground or add a new ground, which may be necessary. 6. It is, therefore, prayed that the order of Ld. CIT(A) may be cancelled and that of the Assessing Officer may be restored to the above fact.” 3. At the time of hearing, it was submitted by the Ld. AR for the assessee that appeal filed by the Revenue is hit by recently issued CBDT Circular No.17 of 2019 dated 08/08/2019 revising the previous thresholds pertaining to tax ITA No.191/Rjt/2022 ITO vs. Smt. Sapnaben Vijaybhai Shrimankar Asst.Year –2015-16 - 3 - effects. As per aforesaid Circular, all pending appeals filed by Revenue are liable to be dismissed as a measure for reducing litigation where the tax effect does not exceed the prescribed monetary limit which is now revised at Rs.50 Lakhs. In the instant case, the tax effect on the disputed issues raised by the Revenue is stated to be not exceeding Rs.50 lakhs and therefore appeal of the Revenue is required to be dismissed in limine. 4. The Learned DR for the Revenue fairly admitted the applicability of the CBDT Circular No. 17 of 2019. Accordingly, appeal of the Revenue is dismissed as not maintainable. However, it will be open to the Revenue to seek restoration of its appeal on showing inapplicability of the aforesaid CBDT Circular in any manner. 5. In the result, the appeal of the Revenue is dismissed. This Order pronounced in Open Court on 23/08/2023 Sd/- Sd/- (WASEEM AHMED) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 23/08/2023 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, राजोकट / DR, ITAT, Rajkot 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार Dy./Asstt.Registrar) आयकर अपील य अ धकरण, राजोकट / ITAT, Rajkot